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Half of US and European bodies lagging in IoT adoption

Steve Rogerson
February 16, 2017
 
Half of organisations in the USA and Europe are lagging behind in IoT adoption, according to a study by Indian IT services company HCL Technologies.
 
The survey of senior business and technology decision–makers on the IoT in large global enterprises talked with early adopters of the technology. Half of respondents said their organisations were already behind the curve on the IoT, while 43% said their customers would suffer from their organisation’s failure to use the IoT fully.
 
Nearly half of respondents (49%) said an uncoordinated, siloed approach to the IoT was holding them back from moving beyond pilots into revenue generating opportunities. And 65% said the primary drivers for adopting the IoT were improving business process efficiency and better customer satisfaction.
 
Approximately four in ten (38%) organisations are using the IoT and a further 57% plan to use it in the future, with 82% agreeing that organisations embracing the IoT were likely to be in a stronger position in the marketplace.
 
These findings indicate that many businesses are still in the early stages of IoT adoption, where its use is limited to a single business function, rather than being committed to a formal business-wide programme.
 
“Many companies have made inroads into the IoT, but when you peel away the layers very few have embarked on truly transformative programmes,” said Sukamal Banerjee, global head of IoT at HCL Technologies. “Success depends on an enterprise-wide IoT strategy that centralises a significant portion of the data from connected assets onto a single platform, where it can be used to generate revenues and new opportunities. It is only by doing so that they will reach the ultimate goals of IoT – organisational efficiency, more profitable business models and competitive edge.”
 
For example, he said, manufacturers could use sensor data to charge customers based on hours of equipment in operation, or lab equipment providers could detect and automatically replenish supplies.
 
The research findings indicate that the solutions to the problems that are holding businesses back from committing more fully to the IoT are dependent on selecting the right IoT platform. Perhaps in response to these challenges and to avoid falling behind, almost three-quarters (73%) of respondents said they planned to enlist the support of a specialist IoT service provider.
 
“With a lot of aggressive technology selling going on in the name of IoT, it’s extremely difficult for businesses to see a clear and rapid path to realise full value, but this is no time to sit on the side-lines,” said Banerjee. “In capital intensive industries, the digital economy will force the gap between innovators and followers to the ability to create intelligent insights from a full range of IoT assets. This process can be incredibly daunting, so next–generation service offerings will play a crucial role in guiding organisations and helping them discover new types of value and a new, more effective way to compete.”
 
Commissioned by the IoT business unit of HCL Technologies and conducted by independent technology market research company Vanson Bourne, the survey was completed by 263 senior IT and business decision-makers at large enterprises in a cross-section of vertical markets in the USA, UK, Germany and the Nordics. A multi-level screening process ensured that only those enterprises that felt the IoT was relevant to their organisation were given the opportunity to participate.
 
About half of global small, mid-sized and large enterprises will deploy some kind of IoT-enabled enterprise resource planning (ERP) by 2022, according to Research & Markets, by when its says there will be an incremental $50bn market for ERP software and services.